Wembley red card to cost Cleveland Bridge £500k

Cleveland Bridge faces a £500,000 bill to compensate the 250 workers thrown off the £757m Wembley Stadium project.

The steel fabrication and bridge-building contractor was left "gobsmacked" by Multiplex’s decision last week to invoke a 28-day notice period and replace Cleveland with Dutch contractor Hollandia, the original runner-up for the £60m steelwork deal in 2002.

Cleveland said it was baffled by the main contractor’s decision as it had successfully completed the complex task of building and raising the Wembley arch, while Multiplex itself has maintained that the project was running to budget and on schedule for its May 2006 opening.

This is the second major blow to hit Cleveland Bridge this year. In late February it announced that 240 of the 920-strong workforce faced redundancy at its Darlington base as a result of clients "stalling" over a number of future projects (CJ 3 March).

A source told CJ: "Cleveland Bridge was absolutely gobsmacked when it was told it was off the project. It came totally out of the blue.

"The decision means that not only is Cleveland Bridge going to have to pay £500,000 in redundancy payments, but its workers have been left high and dry. Cleveland Bridge has put everything into this contract and thought it would need every single member of staff for two years," he said.

After meetings with Multiplex, Hollandia and the unions, Cleveland Bridge offered to second its staff to the Dutch contractor, but this offer was initially turned down.

However, CJ understands that Hollandia has already taken on steel erector Fastrack.

Late on Monday Amicus representatives met Hollandia and Multiplex to discuss the future of the union’s 205 members on the project. Regional officer Frank Westerman told CJ the union wants to establish: who will pay compensation to its members and whether all contract terms and conditions will be honoured; and how many staff will be transferred to Hollandia.

Should workers be transferred Amicus wants Hollandia to adopt a last-in-first-out policy. The union expects an answer within a week.

Cleveland will continue to do some offsite fabrication work for the project, Hollandia will then complete the remaining steelwork, including the contract to build the roof.

CJ has also been told the project will bust its budget. A project source said: "We believe the whole project is going to cost at least another £100m on top of the £750m-plus already spent.

"The cost of steelwork is likely to add £40m, cladding a further £20m, and the civil engineering bill an extra £20m. The M&E work hasn’t even started yet and that is always an expensive part of any project."

Wembley National Stadium said any comment would be made by Multiplex. However, Multiplex failed to comment.